CONTENTS

The Bosnian Peace conference in London created the Peace Implementation
Council (PIC). Its non-military framework for ensuring a lasting peace in
former Yugoslavia:
- The PIC will comprise the 42 nation states and 10 international
organizations represented at the London meeting and will meet every six
months.
- It will have a steering board chaired by High Representative Carl Bildt
that will comprise the G7 countries plus Russia, the country holding the
European Union presidency and European Commission and Organization of the
Islamic Conference representatives.
- The steering board will probably hold formal meetings monthly but have
contacts on an almost daily basis.
- It will invite representatives of organizations like the United Nations
and the Organization for Security and Cooperation in Europe (OSCE) to
attend meetings when required.
- Bildt will take his political guidance from the steering board. His
task will be to liaise with NATO to ensure the two flanks of the operation
mesh and oversee all non-military aspects of implementing peace and of
reconstruction.
- Bildt will be in close contact with the OSCE and its head of mission,
who has yet to be named.
- The OSCE will be responsible for organizing democratic elections within
six to nine months in Bosnia, monitoring human rights and
demilitarization.
- Bildt will be based in Brussels but will have a sizeable staff in
Sarajevo led by his deputy, who is expected to be Germany's Michael
Steiner.
- Bildt will also liaise with the UNHCR refugee agency, the only U.N.
agency to be given a formal mandate under the Dayton accord. It will try
to repatriate or resettle three million displaced people and refugees in
former Yugoslavia.
- A U.N. civilian police force dubbed the ``international police task
force'' will consist of 1,500 men. Their main task will be to train
Bosnia's police force.
- It is not yet clear who will be given the task of hunting down and
arresting war criminals indicted by the International Criminal Tribunal in
the Hague.

James Wolfensohn, the president of the World Bank said on Saturday
Bosnia needed $4.9 billion over the next three years to repair its
shattered economy and pledged a $600 million emergency package as soon as
possible.

The immediate priorities were to restore food production and
agricultural distribution, rebuild roads, schools and hospitals, get power
stations restarted and provide for the return of teachers and medical staff.

Mr. Wolfensohn said:
"You have a country with a problem here...This is a country which is not
functioning."
"The objective in the first quarter of next year is to get the country
functioning."

"If the World Bank is to be effective we cannot be the sole financier.
We're prepared to coordinate and put in the lead financing. We'll do this
as long as others come along."

"We're there to help them -- they will run the plan."

Wolfensohn said the debt, combined with the proposed aid package,
amounted to $8.1 billion. "That is nothing like the loss in the country
has suffered. It will not get it back to where it was before the war, but
will restart it,"

Nine out of 10 people were living on state aid, 80 percent of power
generation potential had been destroyed and two-thirds of housing had been
damaged.

Diplomats say that with NATO's energies devoted to a huge peacekeeping
task in Bosnia, conflict in Croatia may erupt again.

NATO powers ruled out sending troops to oversee Eastern Slavonia's
transition as Tudjman sought and the U.N. hoped, since it has run out of
money for peacekeeping.

The loss of peace momentum in Eastern Slavonia was brought home on
Saturday when Belgium said it would withdraw its 700 U.N. peacekeepers
there next month without a sensible solution.

The only other peacekeepers are 800 Russians, discredited by years of
alleged black-marketeering with the rebel Serbs.

Croatian Foreign Minister Mate Granic warned: "The U.N. is history for
us already. Even if no other international forces come by January 15, the
U.N. will have to leave by then."

Senior European diplomats commented the Eastern Slavonia:
"Eastern Slavonia is getting short shrift now with all
attention focused on NATO in Bosnia, and that's dangerous."
"Things will have to be clinched in Paris on December 14
and the Security Council must act fast after that."
"Milosevic must deliver or we will have a crisis. The local
(Slavonian) Serbs will not really budge unless pressured by
their master, Milosevic."

The diplomats say no one really knows how to fulfil the Basic
Agreement's pledge to put Croats back in their homes without violence or
prevent a mass Serb exodus defeating the very purpose of the pact -- to
restore Slavonia's multi-cultural character.